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CFPB Announces Spring 2016 Rule Making Agenda
Thursday, May 26, 2016 6:45 AM

The Consumer Financial Protection Bureau has recently released its rulemaking agenda for spring 2016, which contains items important to credit unions. Highlights of the rulemaking agenda include the following proposed rules:

  • Proposed rule on payday loans and deposit advance products aimed at addressing consumer harms from practices related to payday loans and other similar credit products. The proposed rule will likely affect credit union consumer-friendly small-dollar loans and is anticipated in conjunction with a June 2 field hearing.
     
  • Proposed rule that will amend the TILA-RESPA Integrated Disclosure—specifically the amendments that became effective on Oct. 3, 2015. The amendments have generated confusion and uncertainty for creditors, and the proposed rule will seek to correct these issues and provide additional clarity.
     
  • Proposed rule on arbitration clauses. The proposed rule will ban certain providers of consumer financial products or services from using arbitration agreements to compel arbitration of consumer class actions and will require the reporting of certain information concerning consumer arbitrations to the CFPB. The rule will require credit unions to insert language into their agreements reflecting this limitation.  

The agenda also includes the following final rules:

  • Prepaid Accounts. The final rule would bring prepaid products under Regulation E's periodic statement requirement; would apply Regulation E's limited liability and error resolution provisions to prepaid accounts; would require prepaid account issuers to post account agreements on their websites and provide them to the CFPB; and would regulate prepaid accounts with overdraft services or credit features, among other requirements. The final rule is anticipated in early summer 2016.
     
  • Mortgage Servicing. Final rules implementing provisions of TILA-RESPA took effect Jan. 14. The CFPB proposed amending various provisions of its mortgage servicing rules in Regulation X and Regulation Z, proposing clarifications on the applicability of certain provisions when the borrower is in bankruptcy, proposed enhancements to loss mitigation requirements, provisions on rules to successors in interest, and others. The final rule is anticipated in early summer. 

Additional, pre-rule activity will be undertaken by the CFPB on debt collection, installment loan and vehicle title loan markets, and business lending data. The CFPB is also continuing to research overdraft practices.

The CFPB issued a white paper in 2013 that highlighted possible consumer protection concerns, including how consumers opt in to overdraft coverage, overdraft coverage limits, transition posting order practices, overdraft and insufficient funds fee structure, and involuntary account closure. It also submitted a report in 2014 based on data from the same sources. The CFPB is currently engaging in additional research and has begun consumer testing initiatives relating to the opt-in process. 

The CFPB's Agency Rule List – Spring 2016 can be read here. Cornerstone will continue to monitor all proposals released by the CFPB and will seek member comments.